Olympics, one last time

Now that the Olympics is behind us and the countdown to Rio 2016 has begun, introspection generally takes place in countries that have fared rather poorly at the Olympics. Why do some countries do better than the rest in the biggest sporting event in the world? Is there a co-relation between development and performance at the Olympics? Are there similarities between how a country is placed in the international trade arena and it's performance at the Olympics? I had blogged earlier about the medal count at the Olympics and it's relation to international economics here.

Project Syndicate has two extremely engaging pieces on the possible relationship between economic development in it's various facets and Olympic performance. It highlights the inextricable link between a sound economic national base and sporting prowess.

Robert Skidelsky predicts the performance at the Olympics is based on key economic indicators including GDP in his piece.

"The most striking finding is that the medal count can be predicted with great accuracy from four key variables: population, GDP per capita, past performance, and host status. Everything else – different training structures, better equipment, and so forth – is pretty much noise. 

CommentsThe impact of population and GDP is obvious: A large population increases the chance that a country will have athletes with the natural talent to win medals, and a high GDP means that it will have the money to invest in the infrastructure and training needed to develop medal-winning athletes.Comments 

Past performance is also important: the visibility and prestige of a sport increases after Olympic success, as does funding. Medals attract money; failure results in cuts."

Drawing an interesting parallel between "picking winners" in terms of encouraging a particular sport so that the chances of an Olympic medal are high and the "State" picking sectors to drive economic development, he seems to support a "State capitalism" model. China would probably fit into this description - it has done exceedingly well both in the Olympics and on the economic front.

"Nothing is more discredited in Anglo-American economics than the policy of “picking winners.” The consensus has been that it inevitably leads to the state “backing losers.” Economic success, on this view, is best left to the unfettered play of market forces. 

CommentsThis philosophy has been heavily jolted by two inconvenient facts: the financial collapse of 2007-2008 and the experience of countries like Japan, South Korea, Taiwan, Germany, and even the US, where economic success depended heavily on sustained government investment of the kind that has produced Olympic medals. As in sports, so in economic life: government commitment can start a virtuous circle of success, while government neglect can trigger a vicious circle of decline." 

Another contribution from Zaki Laidi titled "Olympolitik" highlights the role of population, economic development, a sports policy and sports traditions as the reasons for performance at the Olympics.

"There are, in fact, four factors behind Olympic power: population size, sports traditions, sports policy, and level of development. Taken separately, none of these factors can explain a country’s Olympic record. Collectively, however, their explanatory power is relatively large."

Ofcourse, there may be a variety of reasons for Olympic success and a number of countries would be proving to be counter-examples to the generalizations set forth in the two articles above. However, the analysis made above seems to be well borne out by Olympic performance in the past decades. It raises important issues about the role of the State in sports development especially as a facilitator and supporter. Like in a globalized world, while State involvement in the economy is a necessary constituent of development, it's nature, extent and motives remain as relevant to international trade as much as to sport's policy. The venue shifts, but the issues remain the same!

 And yes, this is my last piece on the Olympics till 2016!

Olympics, national dress and "Buy American"

The Olympics is over and the controversy around the U.S. national Olympic dress too silently subsided. I had blogged about it here. However, apart from a Bill being proposed to ensure that the U.S. national parade dress for international events was made in the U.S.A (it was discussed in the IELP blog here), the USOC voluntarily seem to have adopted a "Buy American" policy.

Global Trade Alert, that sound board of protectionism brought to light the amended policy of the USOC on this issue here.

"“All uniforms provided by sponsors, partners, licensees, or suppliers for parade ceremonies shall be ‘Made in the USA’ as defined by the standards of the Federal Trade Commission,” with certain defined exceptions (e.g., when “Obtaining such parade ceremony uniforms would be in violation of U.S. law or would not comply with any applicable trade agreements or treaties to which the United States is a party” or when “Essential materials or parts needed to produce parade ceremony uniforms are not available in the United States”). The USOC also committed to not changing the policy without first consulting with Congress, including the relevant Committees of Jurisdiction in the Senate and the House."

This would start going into effect from 2014. The 2016 Olympics in Brazil will have the U.S. team walking with a national dress "Made in the U.S.A." 

The issue was also inevitably reflected n the IELP blog about whether the measure of USOC (a private entity) would violate WTO law. While a law mandating a "Buy American"would probably not pass the test of international trade rules, a private body's policy may be exempt from WTO rules. However, is USOC exercising "governmental authority" or is the control of Congress on change of the policy indicate "governmental authority" thus making it subject to WTO law?

I had some other queries too, some trivial and some more relevant to the legal issues at hand:

1. This Policy is applicable only for "parade uniforms". I guess the sporting events uniforms are not covered. Thus, sportspersons could continue to use sportswear made anywhere (especially China?) for their sporting events.

2. While the legislation would have been inconsistent with NT principles, will the "USOC policy" which mirrors the legislation be violative of WTO law since the USOC is a "private body"?

3. USOC,in its policy, states that the policy would not be changed "without first consulting the Congress." Does this make it a "State measure" open to challenge?

4. What about the equipment, sports gear and other dress worn by the US team in future Olympics? Will there be pressure now to shift entirely to "Made in the U.S.A."?

Perhaps, the next Olympics and "national pride" will re-engage us with some of these issues.

Olympics, globalization and the medal count

The Olympics 2012 has ended and so has the controversy surrounding the national dress of a few countries. The medal tally of the top five were as follows:

Is it surprising to find that the two countries that are most active in the multilateral trading system in terms of trade, disputes and power also top the Olympics medal tally? Is there an inextricable link between trading power and Olympic prowess? Are outward, less protected economies more likely to do well at the Olympics?

A piece titled Globalization and the Olympic Games traces the history of the Olympics and highlights the similarities between globalization and the games. It also attributes the huge success of the games in recent years to the spread of globalization in terms of easier transportation, enhanced technology and participation of transnational corporations.It highlights the role of global investments, reality of transnational corporations investing in the Games and the goal of improving local infrastructure as essential features of an Olympic event. It brings together people across nationalities competing on the same platform. Stressing that Olympics has a positive impact on a globalized world looking for peace and security it concludes:

"The magnitude of the Olympic Games is incredible. The ability to bring together the best talent from around the globe to compete in a single international sporting competition is correlates with the rapid expansion of globalization. Questions about who hosts, attends, or targets the Olympic Games are constantly changing as globalization revolutionizes the way countries interact. Increased media attention heightens sensitivity to actions made before, during, and after the Olympic Games. The spread of modern technology is the driving force behind the expansion of the Olympic Games. The spread of modern technology like cars, planes, wireless internet, computers, and mobile phones increases communication between countries, expanding the international influence of the Olympic Games. Globalization continues to change how countries participate and utilize the Olympic Games as well as the dynamics of the entire international community. Learning how to adapt to the rapid spread of globalization allows international events like the Olympic Games to comprehend potential threats and develop new ways to achieve their original goals of promoting international peace and educating youth through sport."

While national tempers and pride are at stake, it also signifies the oneness of humanity and the greatness of sports as a leveller. The best competitors win. It does not matter if your coach is a foreign national or the equipment is from another country - what matters is how you perform. While competition in the Games is strongly on nationality, global realities run deeper.Forget the national dress controversy, protectionism and "Buy local" goods issue - the Olympic Games is much larger than all that.

Russia - Joins WTO and has a locally made national Olympic dress

Russia has formally joined the WTO with the Russian President signing on the legislation that ratified Russia's accession to the WTO. This ended an almost two decade old accession process and brings Russia into the multilateral trading system eleven years after China entered it. The reports of Russia finally joining the WTO are found here, here and here. I had earlier blogged about Russia joining the WTO here, here, here and here.

Apart from the signing of the WTO ratification, President Putin also called on his Russian Olympic Team to "Let London hear the Russian Anthem" in the official Presidential send-off exhorting them to excel in London.

 On a lighter note, I was curious to know about who manufactured the national Olympic dress of the Russian team in the light of the controversy about the U.S. Olympic Team's "Made in China" dress, that I had blogged about here. The Russian national dress is manufactured in Russia by a Russian company, Bosco Sport based in Moscow. Thus, no controversy over outsourcing of Russia's Olympic dress to China though a murmur about a U.S. company American Apparel being offered the deal was doing the rounds here and here.

Just to add colour to the debate, I researched further on China's official national dress for the Olympics - it was perhaps made in China but sponsored by a U.S. company - Nike. Truly globalized world indeed.


As one commentator rightly put it:

"Oddly enough, the Olympics exist as a place where nations can compete — and compete furiously — in place of real world disputes. One sentiment yet to be expressed, that the two nations just settle it in the field/court/pool/track."

Who would have imagined that the Olympics would be the next stage for globalisation and its tensions to take over? 

Olympics, "Made in China" and a furore

With the Olympics a few days away, a controversy has erupted in the U.S. over China made uniforms that the U.S. delegation is going to wear to London. Who would have ever drawn a connection between Olympics and "protectionism"?

Critics in the U.S. have objected to the U.S. Olympic Association having procured the official dress of the U.S. delegation to the Olympics from China.It had to be China! They have insisted that U.S. sportspersons should wear uniforms and dresses made in the U.S. rather than from outside.

An interesting fact is that though the dresses were made in China, it was by a New York based American company, Ralph Lauren. There were angry calls of rejecting them with some representatives saying:

“I am so upset that I think the [U.S.] Olympic Committee should be ashamed of themselves, I think they should be embarrassed, I think they should take all the uniforms, put them in a big pile and burn them and start all over again.” 

Cafe Hayek has an interesting point - are the garments "Made in China" at all? Echoing a letter to the WSJ, it  signifies a "Made in the World" reality rather than being made in a particular country:

"As you suggest, the 2012 U.S. Olympic uniforms are labeled “Made in China” simply because workers in China supplied the relatively low-valued-added service of stitching together inputs from all over the globe – including from America – into their final form as Olympic sportswear.  The unfortunate convention of identifying the country of final assembly as the country in which a good is “Made in” masks the fact that nearly all goods today are “Made Everywhere on Earth.”

China, expectedly, reacted rather strongly calling the attitude of the U.S. "hypocritical" and "irresponsible".It was reported here and here.

Some thoughts:

I wonder what percentage of Olympic dresses that sports delegations from across the globe wear   at the Olympics would belong to the country of the sportsperson? What about the sports equipment? Which country dominates exports of sport equipment? Should countries shun importing the best state of the art equipment for their respective teams and instead rely on locally produced equipment? Unthinkable? Olympic spirit and globalization go hand in hand?


Writing in the CATO Institute blog Daniel Ikenson has this thoughtful retort on the issue:

"If you are still not convinced that our policymakers’ objections are inane, consider this: As our U.S. athletes march around the track at London’s Olympic stadium wearing their Chinese-made uniforms and waving their Chinese-made American flags, the Chinese athletes will have arrived in London by U.S.-made aircraft, been trained on U.S.-designed and -engineered equipment, wearing U.S.-designed and -engineered footwear, having perfected their skills using U.S.-created technology."

The WTO website coincidentally published today the Panel report on the China Electronic Payment case that the U.S.  had filed against it which China lost. More fodder for the critics of  global trade on both sides? The USTR website has the official response to the Panel Report:

"“This decision will help U.S. companies and increase American jobs as a more efficient credit and debit payment system in China enables consumers to buy more goods, including quality, made-in-America products,"said Ambassador Kirk."

"Made in America" products for consumers in China but no "Made in China" products for US Olympians?


Update: Ralph Lauren calling itself a "proud outfitter of Team USA" released a rather unapologetic statement about the controversy:

"“For more than 45 years Ralph Lauren has built a brand that embodies the best of American quality and design rooted in the rich heritage of our country. We are honored to continue our longstanding relationship with the United States Olympic Committee in the 2014 Olympic Games by serving as an Official Outfitter of the US Olympic and Paralympic teams.

Ralph Lauren promises to lead the conversation within our industry and our government addressing the issue of increasing manufacturing in the United States and has committed to producing the Opening and Closing ceremony Team USA uniforms in the United States that will be worn for the 2014 Olympic Games.”

What next?